Analysts: Trump bill will support the stock market, optimistic about cyclical industries

Gene Goldman, chief investment officer at Cetera Investment Management, said of the passage of the "Big and Beautiful" bill: The bill provides clear benefits for businesses and households, and these benefits tend to support corporate earnings and stock prices. We will ignore the fact that the Congressional Budget Office expects the bill to add about $3 to $3.40 trillion to debt over the next decade. The likely need for a larger Treasury issuance has sparked caution in the bond market, as evidenced by the rise in bond yields. In addition, these higher deficits could push up inflation expectations. From the perspective of the equity sector, cyclical sectors are expected to benefit, particularly energy companies (removal of green energy subsidies), industrial companies (increased infrastructure spending), the financial sector (reduced uncertainty, general deregulation, and steepening of the yield curve), and consumer goods (lower taxes).